Cement Price Hike: Minister recommends gas concession to electricity companies

The Minister of Industry, Trade, and Investment, Doris Nkiruka Uzoka-Anite, advocated on Tuesday that gas concessions given to electricity companies should be extended to cement manufacturers to address the product’s price hike.

The Minister, represented by the Permanent Secretary, Ambassador Nura Rimi, made this statement during an investigative hearing by the House of Representatives Joint Committee on Solid Minerals, Industry, Commerce, and Special Duties, which was probing the price increase on Tuesday.

According to the Minister, “The cement manufacturers should be accorded ‘the gas to light price’ as enjoyed by electricity distributors.”

She pointed out that a recent meeting with the Minister of Works, Engr. David Umahi, and major cement manufacturing companies recommended the same measure.

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“There is a need for friendly gas pricing. The meeting recommended that the gas-to-power concession given to the electricity companies should also be enjoyed by the cement companies,” she said.

She identified some challenges facing cement manufacturers, including the cost of gas, high import duties on spare parts, poor road networks, high foreign exchange rates, and the smuggling of cement to neighboring nations.

She added that both the cement manufacturers and the government noted that the current high price of cement is abnormal in some locations nationwide and it was unanimously agreed that cement retail prices should not exceed 7,000 to 8,000 per 50kg bag, depending on the location.

She said that the government advised cement manufacturers to set up a price monitoring mechanism to ensure compliance, and the manufacturers have willingly accepted this and agreed to sanction any distributors or retailers found wanting.

She noted that the country is self-sufficient in cement manufacturing with major players like Dangote Industries Limited, BUA Group, and Lafarge Holcim.

She said the Ministry was deliberating on how to bring back into the sector the cement companies that had stopped construction, addressing their challenges and finding a way to reintegrate them.

However, the committee members were not satisfied with the Minister’s submissions.

The Chairman of the Committee, Hon. Gaza Jonathan Gbewfi, wondered why cement manufacturers were complaining about roads when their activities were largely responsible for the bad roads in the country.

He noted that it was also a corporate responsibility of the cement companies to ensure road maintenance, especially since there were incentives for them.

Other members also questioned why Forex was an issue when most of their materials were sourced locally.

Gbewfi directed the Ministry to make available its minutes from the meeting with the cement manufacturers, a comprehensive report of all pioneer statuses issued to all the cement companies from inception, and a list of the incentives available to them.